The Federal Housing Finance Agency (FHFA) recently announced that Fannie Mae and Freddie Mac will continue to offer COVID-19 forbearance to qualifying multifamily property owners through June 30, 2021, subject to the continued tenant protections FHFA has imposed during the pandemic. The programs were set to expire March 31, 2021.
“COVID-19 continues to financially impact Americans across the country, thereby hindering many tenants’ ability to pay their rent. To help tenants in financial distress and property owners, FHFA is extending the multifamily COVID-19 forbearance and tenant protections through the end of June 2021,” said FHFA Director Mark Calabria.
Property owners with enterprise-backed multifamily mortgages can enter a new or, if qualified, modified forbearance if they experience a financial hardship due to the COVID-19 emergency. Property owners who enter into a new or modified forbearance agreement must:
– Inform tenants in writing about tenant protections available during the property owner’s forbearance and repayment periods
– Agree not to evict tenants solely for the nonpayment of rent while the property is in forbearance
Additional tenant protections apply during the repayment periods. These protections include:
– Giving tenants at least a 30-day notice to vacate
– Not charging tenants late fees or penalties for nonpayment of rent
– Allowing tenant flexibility in the repayment of back-rent over time, and not necessarily in a lump sum
In addition to requiring written tenant notification, the enterprises have posted the tenant protections to their respective online multifamily property lookup tool websites. The property lookup tools make it easier for tenants to find out if the multifamily property in which they reside has an enterprise-backed mortgage.
These actions are just the latest steps FHFA has taken to benefit renters, property owners and the mortgage market during the pandemic. FHFA will continue to monitor the data and the coronavirus’ impact on tenants, borrowers and the mortgage market and update policies as needed. FHFA may extend or sunset its policies based on updated data and health risks.